When buying property you may have come across the term ‘days on the market’. Do you really know what it means and if it’s relevant to you? In this market insight we discuss this further and provide an example to help.
What are days on the market?
The term days on the market refers to the number of days between the day a property is listed on the market and the day it is actually sold.
If a property was listed for sale in a competitive market when demand is high and sold in two weeks, this means the listing was 14 days on the market.
What can they mean for buyers or sellers?
Every seller wants to be able to sell their property as soon as possible. In fact most would love to have it sold within a week from listing it. This is not obviously realistic but it can happen.
However, finding a balance in selling your property is more important than you realise. If the number of days on the market was only a few this could indicate a high-demand property market. This could also indicate that the property was sold under-priced.
Furthermore, if a property has been on the market for a considerable amount of time, it may demonstrate that the property is seen to be a high risk such as being over priced or damaged. Therefore days on the market can drive the demand of what a buyer is willing to pay.
If a suburb has a large number of properties listed for sale at the same time, this may cause a property to take longer to sell. Unfortunately, if buyers notice an oversupply, they may take their time or attempt to take advantage of the situation by reducing their offer.
If your property is on the market longer than other properties in the suburb, this can also create more negotiating power in favour of the buyer.
If you are selling your property in a seller’s market or when demand outweighs supply you’ll experience fewer day on the market.
This length of time is often used to describe just how hot the market is in a particular location or suburb.
If a home is listed for sale in a highly competitive market where there are a lot of buyers. The house sells two weeks later, making days on the market 14 days.
Should we make decisions based on days on the market?
If you’d like to talk about your investment objectives, please don’t hesitate to contact us. We specialise in sourcing brand new and off the plan properties.
While we have taken care to ensure the information above is true and correct at the time of publication, changes in circumstances and legislation after the displayed date may impact the accuracy of this article. If you want to learn more, please contact us. We welcome the opportunity to assist you.
July 2021
